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BUSINESS LAW 2: An award of damages for breach of Global Release of Claims

The parties are two companies and their individual owners. Plaintiffs and his company entered into a business relationship with defendants and their LLC.  Plaintiff is a licensed realtor. He agreed to buy and manage properties on behalf of defendant and its clients.  The parties parted ways and forged a “Global Release of Claims” (GRC) without need for a lawsuit. Plaintiffs agreed to pay defendants $65,000, and to relinquish four computers and a truck. In return, defendants released and forever discharged any and all claims against plaintiffs. Defendants also agreed not to institute any action against plaintiffs or file any complaints with any government agency or professional boards. The subsequent litigation stems from this provision.

Despite the Release of Claims unambiguous terms, defendants filed complaints against plaintiffs with the Department of Licensing and Regulatory Affairs (LARA). Plaintiffs responded by filing a lawsuit. The complaint alleged that the Defendants breached the GRC by filing a complaint with the State of Michigan falsely accusing the Plaintiff of embezzlement, fraud and other crimes and requesting damages and sanctions against Plaintiff.

The circuit court granted partial summary disposition in plaintiffs’ favor on their breach of contract claim, and instructed the parties to work out the question of damages. The court also conveyed its willingness to consider an injunction as an element of plaintiffs’ relief.

The parties were unable to come to terms regarding damages or the language of an injunction. During a hearing, both the court and plaintiffs’ counsel acknowledged that LARA might proceed with its investigation even if defendants withdrew their complaints. Plaintiffs’ could have continuing damages if the state did not desist. The court expressed its inclination to enter a preliminary injunction ordering defendants to seek to withdraw the complaint and to conduct an evidentiary hearing regarding the monetary damages based upon the attorney fees, et cetera. Defendants argued that injunctive relief was improper because plaintiffs had already monetized their remedy.

The court responded: They haven’t monetized the future damages should the State proceed and pull the license and say he cannot participate. So I think that what we’re trying to do is mitigate any potential damages by ordering defendants to request a withdrawal of their complaint from the State of Michigan and to enjoin them from further prosecuting this existing complaint. The court’s order ultimately provided: Defendants are hereby ordered to seek withdrawal of the administrative complaint, filed by them, against Plaintiff.

 On a following date, the court took evidence regarding plaintiffs’ damages. At that point, three LARA complaints were open against plaintiffs. The court reiterated that defendants had breached the GRC by filing complaints against Plaintiff, and entered judgment in plaintiffs’ favor for $15,618.95. This sum represented the amount that plaintiffs had paid their lawyers for defending against the administrative complaints up to the date of the judgment.

Many business litigation matters center on complex agreements. If you are a business owner facing litigation, obtaining the right legal representation is essential.

From our law firm in Plymouth, Michigan, we represent business owners throughout Wayne County and the surrounding region who need help with:

  • Breach of contract litigation
  • Shareholder disputes
  • Partnership disputes
  • Ownership disputes
  • Membership disputes
  • Real estate litigation and lease negotiations
  • Employment litigation

Contact Aldrich Legal Services

FAMILY LAW 83: A trial court can terminate a parent’s rights and permit a stepparent to adopt a child.

A trial court has discretion to terminate a parent’s rights and permit a stepparent to adopt a child when the conditions of MCL 710.51(6) are met. MCL 710.51(6)(b) requires the petitioner to establish that the other parent had the ability to visit, contact, or communicate with the children, and substantially failed or neglected to do so for a period of two years.

PROBATE 53: The trust agreement included an Incontestability Provision.

A settlor’s intent is to be carried out as nearly as possible. Generally, in terrorem clauses are valid and enforceable. However, a provision in a trust that purports to penalize an interested person for contesting the trust or instituting another proceeding relating to the trust shall not be given effect if probable cause exists for instituting a proceeding contesting the trust or another proceeding relating to the trust.

FAMILY LAW 82: Court stated it would terminate the personal protection order (PPO) after the parties present documentation of the initiation of the divorce proceedings.

However, the trial court concluded that these matters should, in fact, be in the province and the jurisdiction of the Family Division and in that respect, having issued a personal protection order, the Court stated it would terminate the personal protection order after the parties present documentation of the initiation of the divorce proceedings.

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FAMILY LAW 77: Court awarded plaintiff sole legal custody; defendant was unwilling to work with plaintiff.

For joint custody to work, parents must be able to agree with each other on basic issues in child rearing including health care, religion, education, day to day decision making and discipline and they must be willing to cooperate with each other in joint decision making. If two equally capable parents are unable to cooperate and to agree generally concerning important decisions affecting the welfare of their children, the court has no alternative but to determine which parent shall have sole custody of the children.

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